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Small and medium-sized enterprises (SMEs) have begun to attract more attention from private equity (PE) investors looking to bet on what they view as small shops with large potential. Specialized SME funds worth nearly $500 million (Rs2,050 crore) have been raised or announced for the Indian market in the past 12 months, and this money will be deployed over the next three-five years. SMEs—companies whose average revenues are between Rs50 crore and Rs200 crore per year—are somewhat under-served by PE investors. Most investors active in India play either in the start-up and early-stage space or in the large-cap (market capitalization) segment. Deal sizes in the SME space look similar to most large-cap PE deals done in the Indian market at present—mostly in the $5-15 million range. But the similarity ends there. […]
Private equity firm Avigo Capital Partners has typically invested in companies that make vaccines, hoses and semiconductors. Now, it has invested in the youth garment brand Spykar Lifestyles Pvt. Ltd, thereby joining the club of PE investors eager to tap consumer-driven businesses. This is New Delhi-based Avigo’s first investment in a consumer business; 25% or $31 million (Rs127.1 crore) of its $125 million India-specific Avigo SME Fund II will go to this segment. In all of 2006, consumer-driven businesses accounted for 17.17% or $391 million of the total $2.27 billion PE investments received by Indian companies, according to US-based financial data provider Thomson Financial. In the first half of this year alone, $275 million in growth capital has already gone to 13 consumer-driven companies—making it 20% of overall deal spend. […]
Temasek Holdings is going big into India’s technology scene via conglomerate Tata Group. According to reports in the Indian press over the weekend, the Singapore investment firm has bought 10 per cent of Tata Sky for US$56 million ($86.3 million), scoring its third major investment in the Tata group to date. An Indian newspaper, The Economic Times, said on Sunday that the stake was “recently diluted” by Tata Group, whose original interest in Tata Sky — a direct-to-home television operator — was 80 per cent. […]
India’s real estate sector may see only as much as $1.2 billion (Rs4,920 crore) in private-equity deals by the end of this year, as investors opt to spread their investment over several years, mirroring the duration of the projects, and belying expectation that billions of private capital will be used up this year alone. That’s barely 20% of the estimated $6 billion queuing up to invest in the real estate market during the current year, with more than a dozen private equity firms scouting for investment opportunities. […]
'String of pearls' deals account for nearly 80% M&As. Jain Irrigation Systems bought a 50 per cent stake in Israel’s NaanDan Irrigation Systems a fortnight ago. The total acquisition cost, including a future investment of Rs 42 crore, was only Rs 87 crore. But it will help Jain Irrigation emerge as the world’s largest drip irrigation company in two years. The Jalgaon-based company (net sales Rs 1,208 crore) has been buying what investment bankers describe as a “string of pearls” for the past year. Before the Israeli acquisition, it scooped up three US-based firms — Chapin Watermatics Inc, Cascade Specialties Inc and Aquarius Brands Inc. […]
Private equity firm General Atlantic Partners may raise its stake in Patni Computer Systems Ltd. by buying some of the founders' holdings, the Economic Times reported on Friday, citing unnamed sources. Gajendra and Ashok Patni, two of the three brothers who founded the software services firm, are looking to sell their stakes, the newspaper said. Their holding in the company total about 29 percent. General Atlantic currently owns 16.4 percent of the New York-listed Patni. […]
The share allotment committee of Deccan Chronicle Holdings at its meeting held on Jun. 08, 2007, converted 1,300 FCCB`s and allotted 541,410 equity shares of Rs 2.00 each. The above mentioned shares have been allotted to Swiss Finance Corp (Mauritius), Worli, Mumbai. The company is holding 1,300 number of bonds. […]
Anil Ambani has been on a buying spree all these months picking up stakes in diverse companies through his financial services arm Reliance Capital. But now it seems he is looking for a buyer who will acquire minority stake in his insurance ventures. And foreign players waiting for a foothold in India are queuing up for a piece of the action. NDTV has learned that ADAG group company Reliance Capital is planning to rope in a partner for the insurance business. The group is likely to sell 26 per cent each in its life and non-life insurance businesses. […]
Temasek is picking 27.74% equity stake in courier and express delivery firm First Flight in a deal worth Rs 107.5 crore. Mumbai-based First Flight, which is a public limited unlisted company promoted by the Saboo family, is the second largest domestic courier company with revenues of around Rs 300 crore. It is the largest domestic private equity deal in the courier and logistics space. As per the deal, Temasek would be picking 41.27 lakh shares through multiple tranches through a preferential issue. The shares would be allotted at Rs 260.47. The funds being raised would be used by First Flight for expansion of its aviation and warehousing businesses. Temasek which is an investment arm of the government of Singapore is routing its investment in the courier company through a Mauritius-based entity Dunearn Investment. […]
Investors with big cash and a roving eye seem to be getting interested in private equity deals in the retail pharmacy, wellness and healthcare companies. A deal or two have taken place already, while loads of enquiries seem to be pouring in. Since these are early days, the numbers are far and few. Elaborating, a leading retail consultant Technopak Advisors chairman Arvind Singhal said: “Private equity players, who have been looking at investment in malls, are now looking at new gen retail ventures in pharma & healthcare services since they are much more lucrative, the turf is yet to get crowded and promises higher returns.” […]
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